Medicaid expansion is an issue that inspires deep passions, with outside interests on both sides working to influence our opinions. It's also an issue that requires Alaskans to make their own decisions about what's best for our state.
Alaska has not seen the same disruption and structural change in health care as in other states. But if we are to see costs moderate and quality improve, we must do things differently. Health care is undergoing radical transformation, away from a system that pays for volume to a system that pays for value. Transformation is hard, requiring organizations to take risk and innovate. Just like any other industry, risk and innovation require capital. Medicaid expansion, through reductions in uncompensated care, provides the capital that can power innovation and transformation.
The benefits of Medicaid expansion are many. From a moral standpoint, it saves lives, providing care for low-income adults who could never afford health insurance. Economically, it provides an immediate injection of $145 million into an otherwise faltering economy. From a fiscal standpoint, it reduces the state budget, as we shift general fund expenditures to federal dollars.
Medicaid expansion is also a pragmatic approach to solving one of our most pressing problems. Do you believe the health care system works as efficiently as it could? Are you happy with the cost of health care? If you answered no to either of those questions, then consider that Medicaid expansion could be the path to an improved health care system for everyone.
For any business, change requires risk, innovation and capital. As we look to moving to a system that pays for value rather than volume, hospitals must find the risk capital to innovate. Medicaid expansion can be a source of that capital through reductions in uncompensated care. Uncompensated care is simply the cost of care for people who received care, but couldn't pay for it. Alaska's non-tribal hospitals provided more than $90 million in uncompensated care in 2013. Medicaid expansion could reduce that number 20-30 percent, providing the capital to help enable health care system transformation.
As an example, PeaceHealth Ketchikan hospital received a Centers for Medicare and Medicaid Services innovation grant for care coordination. As a result of providing better care coordination for all patients, the hospital improved quality and reduced its revenue. Without the grant, the facility would likely not have spent money, to lose money, to improve care. This points to why our system must change, but change requires resources. In this example, the resources came in the form of a grant. Grants are few and far between, but expansion is an opportunity we can seize now.
Sometimes it's hard to have an open mind, especially on issues fraught with political baggage. While the comfort of ideology is tempting, tough times call for pragmatism. The Alaska I was born in is a place where we work together to figure things out, regardless of party or affiliation. As we face a new economic era in Alaska, let's reclaim that common sense.
We are at a critical time where we can accept the status quo. We can decide that our system is good enough. We can decide that we're immune to the forces of change. Or we can put aside rhetoric to ask the question -- what's right for Alaska? Alaskans are tough, practical people -- and as a pragmatist, I believe that Medicaid expansion can be the engine of health care transformation. That's good for us all.
Becky Hultberg is president and CEO of the Alaska State Hospital and Nursing Home Association, based in Juneau.
The views expressed here are the writer's own and are not necessarily endorsed by Alaska Dispatch News, which welcomes a broad range of viewpoints. To submit a piece for consideration, email commentary(at)alaskadispatch.com